Stocks Hit One-Month High

NEW YORK—U.S. stocks rose, marking a one-month high for the Dow industrials, as investors watched budget negotiations and a measure of service-sector activity topped expectations.

Stocks rallied, led by financial shares, amid better-than-expected service-sector data and hopes for stimulus in China. Alexandra Scaggs has details on The News Hub. Photo: Reuters.

The Dow Jones Industrial Average jumped 82.71 points, or 0.6%, to 13034.49, its highest close since Nov. 6. The blue-chip benchmark reversed a 28-point morning drop to post its first daily gain of the week.

The Standard & Poor's 500-stock index added 2.23 points, or 0.2%, to 1409.28. A slumping technology sector kept a lid on the index's gain, as shares of Apple, the most valuable U.S. company, dropped. The tech-heavy Nasdaq Composite Index lost 22.99 points, or 0.8%, to 2973.70.

"Guys don't want to be caught on the sidelines if any kind of deal breaks on the fiscal cliff," said Jim O'Donnell, chief investment officer of San Francisco-based Forward Management LLC, which oversees about $3 billion. "People think that once we get this stupid thing out of the way, we'll probably see a decent rally."

A few dozen Republicans reportedly signed a letter saying all options on taxes and entitlement programs should be explored.

President Barack Obama told business executives that raising tax rates on high-income Americans is the best way to increase revenue to help close the U.S. deficit.

MarketBeat

Bank of America jumped, leading the Dow and closing above $10 for the first time since July 2011.

Travelers Cos. advanced after saying it is resuming stock buybacks, which it had halted while assessing damage from superstorm Sandy. The insurer estimated its losses from the storm at $650 million, far less than those of a competitor.

Citigroup climbed after announcing plans to cut 11,000 jobs to save $900 million in costs next year.

On the economic front, the Institute for Supply Management's non-manufacturing purchasing index, a measure of service-sector activity, rose in November. Factory orders also rose, bucking economists' forecasts for a decline.

But Automatic Data Processing's and Moody's Analytics' reading on November hiring fell short of forecasts. Some investors see the ADP report as a preview to the closely watched government employment report due on Friday.

Asian markets were broadly higher, with China's Shanghai Composite surging 2.9% to a three-week high, after the country's new leader, Xi Jinping, made some encouraging comments about the economy, lifting hopes for continued government support. Japan's Nikkei Stock Average gained 0.4% to close at the highest level in over seven months.

Front-month crude-oil futures slid 0.7% to settle at $87.88 a barrel, while December gold futures slipped 0.1% to finish at $1,692.40 an ounce. The dollar advanced against both the euro and the yen. The benchmark 10-year Treasury rose in price to yield 1.591%.

On the corporate front, Apple's slide came amid as IDC forecast the market share of Apple's tablets will fall below 50% in 2016. Technical analysts—who track patterns on stock charts to try to predict stock movements—pointed to signs the stock's 50-day moving average could cross below the 200-day moving average, a so-called death cross.

Nokia's U.S.-listed shares gained after the Finnish mobile phone giant unveiled its new Windows-based smartphone, the Lumia 620. Nokia also announced the launch of the Lumia 920T in partnership with China's largest operator, China Mobile.

Pandora Media plunged after the Internet radio provider reported better-than-expected fiscal third-quarter earnings, but forecast a surprise loss for the fourth quarter and provided a disappointing revenue outlook.

Chelsea Therapeutics tumbled after the company said its Parkinson's disease treatment did not show a statistically-significant reduction in the rate of patient falls over the course of the Phase III study.

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.